CHINA – Premium Australian-based dairy processor, Nature One Dairy (NOD) has acquired the Hong Kong adult nutrition powder business and brands of Fei Fah Medi Balm (FEI) in a script-based transaction valued at approximately US$30 million.
The transaction has been structured as an asset purchase over a 36-month earnout period. At completion, an upfront payment of US$8m is payable in NOD scrip with a further payment of US$4million within six months of completion.
Two further earnout payments, also to be satisfied in scrip and due over a 36-month period, have also been agreed upon subject to the FEI business hitting minimum annual revenue targets and an average profit target of US$1million per annum.
The acquisition is to enable NOD to advance its drive to expand in key markets of Asia and also enable it to launch further brands for both adults and infants to the market.
NOD expects this acquisition would help it generate strong revenue growth since FEI sells and markets dairy and adult nutrition brands Ripple and White H20 in Hong Kong and Singapore, both for domestic and export markets.
NOD Founder and CEO Nick Dimopoulos said that the Fei Fah Medi Balm business will remain to stand alone but will be incorporated into the existing Nature One Dairy Group.
“The manufacturer of the Ripple brand will now be re-directed from a third-party facility to Nature One Dairy’s milk powder facility in Victoria, bringing efficiencies and supply synergies,” NOD founder and CEO Nick Dimopoulos said.
The deal comes at a time when the adult population in Asia is increasingly leaning towards leading a healthier life by the adoption of more traditional means and methods, using naturally sourced foods, supplementation, and dietary additives.
Grand View Research shows the Asia Pacific nutritional supplements market size was valued at US$140.4 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 6.1% from 2022 to 2030.
According to the market research firm, improving the quality of life through nutritional supplementation and functional foods has become a priority, driving the market in the APAC region.
Betting on this growth, Dimopoulos is anticipating a rise in NOD’s powder business sales to exceed over US$40 million, in addition to the growth in the Sydney-based liquid nutrition business, which is expected to see revenue of more than US$70 million in the fiscal, by 2023.
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